Sharp Draws Flak for Samsung Deal

Sharp Corp.’s capital alliance with Samsung Electronics Co. is upsetting some Japanese bloggers who claim that the made-in-Japan brand is “selling its soul” by teaming up with its South Korean competitor.

Reuters

Sharp’s Aquos television sets displayed at an electronics store in Tokyo.

When the news of Samsung’s investment in Sharp first came out this week, Japanese social media users responded with many comments on Twitter Facebook and other blogs. Some rationally analyzed the potential benefits and risks for Sharp, but others were sharply critical, going so far as to say “Sharp is betraying Japan.”

Though those comments don’t necessarily represent the general public sentiment, they do reflect some underlying frustration over the country’s struggling consumer-electronics industry, which used to be a source of national pride in the glory days of the 1980s and 1990s thanks to iconic products such as Sony Corp.’s Walkman.

Sharp’s alliance with Samsung also came amid lingering tension between Japan and South Korea because of a territorial dispute that escalated last year.

Today, Samsung is the global market leader in many areas of electronics that Japan used to dominate, from consumer products to chips. Still, there is often a wide gap between Japanese consumers’ perception of Japanese brands and how well those brands are actually doing in the rest of the world. Sharp’s Aquos TVs are often the number-one choice when Japanese consumers think of buying a TV. Samsung, the world’s biggest television maker, doesn’t sell TVs in Japan. Sharp smartphones are also popular in Japan, unlike overseas markets where few people consider Sharp to be a leading mobile brand.

In Japan, Sharp has often promoted its national roots to sell TVs. Its domestic TV commercials have featured a classic Japanese garden, a tea house and a kimono-clad Japanese actress.

The deal with Samsung could help debt-ridden Sharp convince its bank lenders that its business prospects are solid. Samsung’s $111 million investment will make the Korean technology conglomerate Sharp’s fifth-largest shareholder with a 3% stake.

After Sharp and Samsung officially announced the deal, the handler of Sharp’s official Twitter account tweeted in Japanese: “I think I understand that there are many people who feel that one of the reasons or bases for supporting (Sharp) has been lost.”

The account received both supportive and harsh comments from many followers. A Sharp spokesman said that the Twitter account is official, but the tweets are not the same as the company’s official public announcements.